First, I apologize for the silence the last week.  A lot going on in my life at the moment and my relaxation time blogging has been severely cut back.  The next two weekends I have a big meeting and a big family event and I suspect I’ll get back to my regular rhythm in about eleven days.  I hope so because I have a lot of material piling up in draft and note form.

Having said that, I just sent off a major “deliverable” so I have a very short break to look at the latest events this week related to the Presbyterian Mutual Society in Northern Ireland.  I gave an update about three weeks ago and want to thank “Anonymous” for the pointer to a current forum for discussion of the situation.

Unfortunately this week’s news about the situation is not confirmation of the rumored deal to bail out the savers and investors.  (And as noted in the comments from last time I have been sloppy with my use of the terms “savers” and “investors,” lumping them together.  I will try to be more precise.)  But the Society was in the news this week as a select committee of the U.K. Treasury met in Belfast to inquire into the collapse of the Society.  For Northern Ireland this was front page news being covered by the Irish Times, Derry Journal, Belfast News Letter, and Belfast Telegraph, among other.  It was also a topic among the blogs including Alan in Belfast and William Crawley: Will and Testament.

And then we have the reports from the Rt. Rev. Dr. Stafford Carson, the Moderator of the General Assembly of the Presbyterian Church in Ireland.  More than an outside observer, he was a focal point at the inquiry as he led the delegation from the Church.  The Irish Times article includes a brief report on a question asked of him by the committee chair, Mr. John McFall, former Northern Ireland Minister:

Mr McFall also demanded to know from the moderator of the PresbyterianChurch, Dr Stafford Carson, if it felt any responsibility to the 10,000savers left unable to access their funds by the sudden failure of thescheme. Dr Carson said the church was very aware of the plight of itscongregation who had invested in the society.

Since the collapse of the Society this has been a sticky point for the Presbyterian Church.  While the Society was a free-standing financial entity, it had very close ties to the Presbyterian Church in Ireland which promoted saving and investing in the Society, had several congregations that were heavily invested, and savers had to be members of the church to put their money there.  However, the Presbyterian Church has made it clear that it does not have financial resources to even begin compensating savers and investors and the collapse was part of the greater global financial crisis so the government should help the mutual societies the same way it helped other financial institutions.

It is important to note that Rev. Carson mentioned this meeting twice in his own blog.  He posted the day before the meeting with a brief description of what this was about and the text of his prepared remarks.  He then posted again after the meeting and among his thoughts he says:

The Treasury Select Committee asked some hard and good questions. Theeffect of that was to re-focus and re-energise the efforts we have madeto get the situation resolved, and for that we are very thankful. Muchof the discussion was taken up with the question as to how this crisiswas allowed to develop, and the failures of the registration andregulation process. The Committee report will make for interestingreading.

This seems to be as close as he gets to mentioning the question to him reported by the Irish Times.  He goes on to say…

All through this crisis, however, we have sought to stay focused on theresolution of the problem. When other financial institutions in the UKgot into trouble, they were bailed out without any inquiry into thecause of their collapse and without regard to the culpability of theinstitution. What became clear yesterday was that no one is reallytaking ownership of the drive towards a resolution, and, as John McFallsaid, the “pass the parcel” game needs to stop and a new political willneeds to be found. We hope that the visit of the committee will helpcreate that will and purpose.

So, we will see if this brings any government action, specifically a bail out like the other financial institutions had.  And without news soon this could become a very hot topic at the upcoming General Assembly.

Finally, it is important to note another piece of news about the Society and that is a further delay in the Administrator making the first payment to investors and savers.  This is where the distinction between the two groups may become important because under the bankruptcy laws the investors, who technically loaned the Society large sums of money, would be due payment before the savers who had lesser quantities on deposit with the Society.  A first payment was initially anticipated last month but clarifying the legal issues, and maybe accumulating more available cash, are holding up the payments until at least March. (Belfast News Letter, statement on PMS web site)  Next week the High Court is scheduled to rule on this as well as hear the request from the Administrator to extend the administration of the Society for five years.

Stay tuned – this has a long way yet to go.